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Have you ever been to Europe? The standard of living is significantly lower than that of the United States. People live in smaller houses with fewer modern comforts (like air conditioning and washing machines) than Americans; they drive smaller cars, and have less overall wealth. Unemployment is far higher in Europe than in the US. The cost of living is much higher than in the US.
I'm not arguing that Europe is a bad place. There is spectacular history and are great people throughout the continent. However, to claim that their economy is better than that of the US is just plain wrong.
Ahhh, but you forgot how and why these banks started lowering their lending standards. Let's not forget the Community Reinvestment Act that ACORN pushed through to supposedly help out low-income people to buy homes. Never mind they could not afford the homes, ownership was the only thing that mattered. The banks resisted lowering their lending standards until ACORN then lobbied to get the govt to back these high risk loans via Fannie and Freddie. The floodgates of lending were opened up and everyone and their unemployed cousins twice-removed bought houses they couldn't necessarily afford.
Let's not forget those that took the loans, they are as much a part of the issue as those that gave the loans out.
Oh, FYI, just to be clear, those giving the loans were not forced to do so, in fact many leanding institutions did not do so.
Casper
Have you ever been to Europe? The standard of living is significantly lower than that of the United States. People live in smaller houses with fewer modern comforts (like air conditioning and washing machines) than Americans; they drive smaller cars, and have less overall wealth. Unemployment is far higher in Europe than in the US. The cost of living is much higher than in the US.
I'm not arguing that Europe is a bad place. There is spectacular history and are great people throughout the continent. However, to claim that their economy is better than that of the US is just plain wrong.
The United States is ranked 13th on the Human Development Index (HDI) - a list admittedly not solely based on economic factors. It's useful to note, however, that square footages and engine sizes don't come into play, either.
The United States is ranked 13th on the Human Development Index (HDI) - a list admittedly not solely based on economic factors. It's useful to note, however, that square footages and engine sizes don't come into play, either.
Well... ask yourself what are some things you enjoy about your life. A nice house? A cool car? A rewarding job? Good food? Great schools for your kids? Fun vacations?
The fact is, a lower cost of living and a higher wage are desirable.
Ahhh, but you forgot how and why these banks started lowering their lending standards. Let's not forget the Community Reinvestment Act that ACORN pushed through to supposedly help out low-income people to buy homes. Never mind they could not afford the homes, ownership was the only thing that mattered. The banks resisted lowering their lending standards until ACORN then lobbied to get the govt to back these high risk loans via Fannie and Freddie. The floodgates of lending were opened up and everyone and their unemployed cousins twice-removed bought houses they couldn't necessarily afford.
When lenders stopped investigating potential borrowers and added a line titled: Stated Income, that was the beginning of the end. They took a borrowers word for their income and never investigated.
When Wall St. banks began to base the amount of annual bonuses for employees on how many mortgages they could sign, that was step two.
When they devised a formula for home value which increased by 6.4% annually to perpituity...step three.
The final straw was when those on Wall St. who evaluated the worth of packaged mortgages stopped looking at them and automatically stamped them AAA.
I repeat... tie up two hours of your time and watch the TV presentation, "House of Cards." It completely investigates the entire picture, interviews all principles including the arrogant FED chairman Greenspan. Nearly everyone was guilty of playing a part in it and not a one accepted any of the blame...not a one.
The entire SEC should have been done away with and never used again. That whole bunch was in bed with Wall St. bankers.
I will check out the presentation of "House of Cards" but before I actually watch it I will do research on the people who put it together to see what there angle is. You will not get an honest description of why the collapse happened from just one side of it. During all my investigations I find there are usually three sides to every story. Both sides, and then the truth. I believe the people on here who stated the Government did not force Fannie Mae or Freddie Mac into making those loans are a little misled. If the government comes to you as a banker and says WE really think you should lower your standards on loans and do not worry we will back those loans, you will take it more as an order and not a simple request. I would be interested in seeing how the banks that did not comply were treated overall.
I will check out the presentation of "House of Cards" but before I actually watch it I will do research on the people who put it together to see what there angle is. You will not get an honest description of why the collapse happened from just one side of it. During all my investigations I find there are usually three sides to every story. Both sides, and then the truth. I believe the people on here who stated the Government did not force Fannie Mae or Freddie Mac into making those loans are a little misled. If the government comes to you as a banker and says WE really think you should lower your standards on loans and do not worry we will back those loans, you will take it more as an order and not a simple request. I would be interested in seeing how the banks that did not comply were treated overall.
Yeah...well anybody who's foolish enough to take somebody's word for their ability to pay back a half million dollar loan, do no checks or background investigation, then stamp a package of those loans AAA and sell the packages to European countries who had always trusted our banks with such mortages, was up to no good.
Every time I've borrowed money to buy a house the lending institution thoroughly investigated every aspect of our finances. Once they even set up and appointment with the CFO of our local credit union and went through two years of my financial records. They looked at the most recent two years of my IRS returns. In one instance a close friend of mine had sent me a check for $10,000 as a personal loan with no contract and they saw the deposit, questioned me about it then refused to close the mortgage agreement until I paid him back and showed them a letter from my friend stating that I had paid him.
When I was a youngster the word which was bantered around about banks was that they would only loan money to people who could prove they didn't need it.
The Wall St. banks and their affiliated lending institutions were the cause of this mess and real capitalism would have let them fail. "Too Big To Fail" is a large dose of horse manure.
I will check out the presentation of "House of Cards" but before I actually watch it I will do research on the people who put it together to see what there angle is. You will not get an honest description of why the collapse happened from just one side of it. During all my investigations I find there are usually three sides to every story. Both sides, and then the truth. I believe the people on here who stated the Government did not force Fannie Mae or Freddie Mac into making those loans are a little misled. If the government comes to you as a banker and says WE really think you should lower your standards on loans and do not worry we will back those loans, you will take it more as an order and not a simple request. I would be interested in seeing how the banks that did not comply were treated overall.
Fanny and Freddie never wrote a loan that was not in there scope. Look into why funding was cut to the OFHEO. Then please tell me why when Bush had concerns about accounting at Fanny and Freddie why not increase that funding.
Have you ever been to Europe? The standard of living is significantly lower than that of the United States. People live in smaller houses with fewer modern comforts (like air conditioning and washing machines) than Americans; they drive smaller cars, and have less overall wealth. Unemployment is far higher in Europe than in the US. The cost of living is much higher than in the US.
I'm not arguing that Europe is a bad place. There is spectacular history and are great people throughout the continent. However, to claim that their economy is better than that of the US is just plain wrong.
Yes I lived in the UK. Other then the weather the and cost the quality of life is in many ways higher then the US. As to things being smaller well its a smaller area with more people...of course you are going to be living in a smaller place. Does NYC have a lower quality of life, just because a 2000sq. ft. house is uncommon there? When I lived there, while they did drive mostly mid-size cars their public transport was awesome. As to comforts they have all the comforts, from dishwashers, to cable TV. In some ways they have more comforts as their cities are all walkable, and planned with plenty of public green spaces. In many ways London is much more livable the most of the sprawl we call cities here. As to Unemployment it is only 6-7% in the UK in some of the worst parts it is 11-12% they have nothing like the 17% we have in Michigan. It is much more expensive and as an American I like America better but most of your criticisms are wrong...have you been to Europe?
Last edited by Randomstudent; 01-02-2010 at 09:18 AM..
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